The Spread of COVID-19 Pandemic Has Added A Unique Dimension To The ‘Great Game’ Between The Two Economic Giants of Asia

The Spread of COVID-19 Pandemic Has Added A Unique Dimension To The ‘Great Game’ Between The Two Economic Giants of Asia

With the growing international criticism against Chinese ‘handling’ of Coronavirus’ threat along with associated economic setbacks, China has directed its diplomats to engage in an all-time high ‘Wolf Warrior Diplomacy’. The spread of COVID-19 pandemic has intensified India-China tensions

Behind all the hand-shakes and friendly gestures between Indian PM Narendra Modi and Chinese President Xi Jinping, the underlying feelings of competition for regional dominance mixed with nationalism were not difficult to decipher when the two leaders met last in Oct 2019 during the visit of the Chinese President to India. Little would Xi Jinping knew then, that a strange catastrophe was going to affect lives of people living in ‘All Under Heaven’, spreading further to the entire world, shaking geopolitical dynamics like never before. Relations between India and China have always been complicated, but the spread of COVID-19 pandemic has added a unique dimension to this ‘Great Game’ between the two economic giants of Asia.

Even prior to spread of COVID-19 pandemic, offensive stance and open criticism of Donald Trump towards lack of transparency in economic policies of China, especially the trade deficit between the world’s largest economies, had seen an all time high. Spread of the pandemic gave birth to ‘Blame-Game’ between the two nations over birth of the virus wherein China pointed fingers at US Army while US questioned the Wuhan lab.

On the economic front, Donald Trump raised the issue of disparity between funding of WHO. According to reports, US contributed $893 million in 2018-2019, while China gave $86 million only. Facing criticism from the international community over the issue, China increased its funding by $30 million, in addition to the previous additional funding of $20 million in March this year.

EVOLVING GEOPOLITICAL DYNAMICS: COVID-19 PANDEMIC

▶ US-China trade war prior to the spread of Covid-19 pandemic.

▶ US cutbacks on funding WHO; China forced to pledge an additional $ 30 million for WHO.

▶ China supplying faulty Covid-19 test kits to India alongside faulty equipment to other countries; loss of face and reputation in business all over the world.

▶ India’s change in FDI policy to safeguard the economic interests of its companies.

▶ The blame game between the US and China over the origin of Covid-19 virus; call for WHO-led probe.

▶ Continued aggression of Chinese militia in the South China Sea; US forced to deploy its warship.

▶ Series of Indo-China border clashes.

▶ Chinese diplomats engaged in an all-time high ‘Wolf Warrior Diplomacy’ to safeguard the national image and economic interests in the longer run.

▶ CCP facing the heat domestically as well as globally; WHA conference and NCP Parliament session a testing ground for Xi’s credibility

Amongst this crisis, India took a lead from the rest of the major economies of the world and changed its policy related to FDI. The revised policy ruled that economic firms in any country that shares a border with India will have to approach the government for investing in India and not go via the automatic route. The step was taken to ensure no neighbouring country, especially China, takes undue advantage amid the COVID-19 pandemic. For obvious reasons, China was infuriated and has criticised India’s new policy.

Relations between India and China soured even more when India rejected the Chinese COVID-19 test kits, claiming them to be inaccurate. ICMR had to halt COVID-19 testing for two days and is now procuring the test kits from South Korea. Similar issues regarding the accuracy of Chinese test kits and poor quality of medical equipment from many other nations has caused the loss of face and reputation for Chinese companies. It has proved to be disastrous for Beijing as a large number of US and German companies are mulling over moving their production bases from China to India while Japan has announced an assistance package for companies shifting their production from China.

In a typical Chinese response, PLA suddenly revived the unresolved Indo-China border dispute by instigated Indian Army troops at Finger 5 area near Pangong Tso (lake) in Eastern Ladakh on 05 May. The second round of clashes between the two forces was reported near Naku La in Sikkim on 10 May leaving almost a dozen troops injured on both sides. Also, Indian Air Force scrambled its jets in response to PLA helicopters flying close to LAC. Chinese have also pitched in tents in Galwan Valley in Aksai Chin, accusing India of constructing defence facilities in the disputed area. Even indirectly, China is using its influence over countries like Nepal, by provoking them to object Indian road construction in Kalapani.

Not only against India, Beijing has been intensifying its military activities in South China Sea as well as in East China Sea, thereby drawing international criticism. In December 2019, Malaysia and Indonesia lodged a complaint against Chinese aggressive activities in the disputed region of the South China Sea and even deployed their naval assets in the region. Vietnam too protested at the UN when on April 2, China sank a Vietnamese fishing vessel in the region. China continued its domination by harassing a Philippine Navy ship. In the second half of April, it unanimously instituted two new municipal districts, carving up the governance of the Paracel and Spratly island groups. Even in the East China Sea, Chinese ships have intruded in waters near the Japanese-controlled islets seven times this year. Spurt in presence of ‘Chinese Maritime Militia’ in disputed regions forced US to move its guided-missile cruiser ‘Bunker Hill’, and amphibious assault ship ‘The America’ into Malaysian maritime territory claimed by China. Australia has also sent a frigate, ‘Parramatta’, into the area.

With the growing international criticism against Chinese ‘handling’ of Coronavirus’ threat along with associated economic setbacks, China has directed its diplomats to engage in an all-time high ‘Wolf Warrior Diplomacy’. The diplomats have been named “Wolf Warrior” after a Chinese patriotic film starring a muscle-bound Chinese commando killing American bad guys in Africa and Southeast Asia with his bare hands. Chinese diplomats are increasingly taking to Twitter and Facebook — platforms that are blocked in their own country. They have been engaging with the international community over social media with an offensive tone to safeguard national image and economic interests in the longer run.

Chinese Communist Party is facing an unprecedented challenge, both domestically as well as in global political domain. As the rate of unemployment climbed to almost 20.5% with up to 70 million unemployed people alongside 205 million people with uncertain employment (set to exacerbate due to COVID-19 pandemic), Beijing is feeling the heat in managing its recessing economy. Belt and Road Initiative, the landmark project of Xi Jinping’s political career, is under immense criticism due to its Non-Performing Assets worth up to USD 101.8 billion. As he faces annual political session of National People’s Congress (annual parliamentary session) on 22 May, he also needs to prepare his stance at the World Health Assembly conference scheduled the same day. He has already softened his stand by allowing a WHO-led probe into the cause of the spread of Coronavirus, to which he had opposed for long. This also signals his first defeat in the global political domain!

From a historical perspective, whenever cornered by foreign powers, Chinese have always preferred to show their teeth, and not a smiling face. Once again, when almost entire world is criticising them for poor handling of the pandemic along with supply of inferior quality medical equipment, China is not likely to show a defensive posture. For China, protection of its economic interest remains Priority 1, as it aims to challenge US for a place in the ‘First World’ of superpowers by 2050. It is best known to take desperate measures to safeguard economic interests of the nation. With the entire world backing away from Chinese companies and Chinese products, it is natural for China to feel cornered. However, ‘The Dragon’ is not habitual of laying low and bearing the punches.

What Threats And Opportunities Do These Present Before India?

As almost all major companies of the world are contemplating shifting their businesses out of China, Indian leadership is required to proactively engage with them presenting the most practicable and convenient option. In the times of ‘Revival of Economic Nationalism’, India needs to create favourable conditions for these companies to set up their manufacturing bases. With the loss of reputation of Chinese companies, especially in the medical sector, Indian companies would only stand to gain.

Militarily, Indian Armed Forces are well poised to thwart any offensive manoeuvre by PLA. Indian troops at the border remain fully resolved to counter any challenge to Indian sovereignty. It only needs to be backed by a strong political will.

The moment is ripe to expand political clout of India as a nation. When the world is pointing fingers at China for their derisory approach in handling COVID-19 spread, India needs to project itself as the major power of South Asia and create a conducive global environment aligned with its national interests.